Education Journalist | Study Abroad Lead | Updated On - Aug 29, 2026
US Homeland Security has cleared a rule ending the H-1B 60-day grace period. White House OIRA completed its review on August 29, 2026. Indian nationals hold roughly 72% of active H-1B visas today. Laid-off workers would lose status the day their pay stops.
- Indian nationals received 72.3% of H-1B approvals in USCIS FY 2024, making them the single largest exposed cohort.
- The rule ends the automatic 60-day window that lets laid-off workers stay, switch employers, or file a change-of-status petition.
- The proposal now enters a Federal Register public comment period before it can be finalised as a binding regulation.
The grace period was created by a January 2017 DHS rule on retention of high-skilled workers. It has become the standard safety net through tech layoffs since 2022.
Also Read: USCIS H-1B Specialty Occupations rules
What the DHS Proposal Changes for H-1B Workers
The current 60-day grace period is codified at 8 CFR 214.1(l)(2). It covers H-1B, L-1, O-1, TN, E-1, E-2, E-3, and H-1B1 visa holders. The DHS proposal removes that automatic buffer entirely.
Under the new framework, a laid-off H-1B worker needs a new employer petition filed and receipted before the last day of pay. If not, the worker falls out of status the same day employment ends.
| Scenario | Current 60-Day Rule | Proposed DHS Rule |
|---|---|---|
| Day of layoff | Status protected | Status protected |
| Day 1 after last pay | Status intact | Out of status |
| Time to find new job | Up to 60 days | Zero days |
| Change to H-4 or B-2 | Allowed within 60 days | Must file before last pay date |
Key Insight: The 60 days was never a guarantee. USCIS could shorten it case by case. In practice it became the buffer that let workers arrange new sponsorship, sell property, and pull children out of school. Removing it forces all three to happen before the final paycheque.
Why Indian H-1B Holders Face the Biggest Hit
USCIS FY 2024 data shows Indian nationals received 72.3% of H-1B approvals. Chinese nationals were second at 11.7%. Any tightening of H-1B status rules lands hardest on Indian workers in Bay Area, Seattle, Austin, and New Jersey clusters.
Layoffs at Amazon, Meta, Google, and Microsoft since 2022 have already sent thousands of Indian H-1B holders into the grace-period route. Some switched to smaller sponsors. Others filed for H-4 dependent status through a spouse. A smaller share shifted to B-2 tourist status while job hunting.
All three paths lean on the 60-day buffer. Without it, an Indian worker laid off on a Friday must be out of the country by Monday, or already have a new petition receipted.
What it means for Indian Students: F-1 students on OPT or STEM OPT planning the standard H-1B jump would enter a market where any future layoff becomes a same-day exit event. Job offers, mortgage plans, and school enrolment decisions all shift under this rule.
When Could the New Rule Take Effect?
OIRA clearance is the last hurdle before publication. The proposal now heads to the Federal Register as a Notice of Proposed Rulemaking. A public comment period of 30 to 60 days follows, during which employers, industry bodies, and workers can file objections.
DHS then reviews comments and issues a final rule. That step typically takes 3 to 9 months after comments close. The earliest realistic effective date is mid-2027, though court challenges could extend the timeline.
Nasscom, the US Chamber of Commerce, and immigration advocacy groups are expected to file formal objections during the window.
How the Change Fits the Wider H-1B Crackdown
This proposal is one of several H-1B tightening moves under the second Trump administration. Others include the September 2025 $100,000 H-1B petition fee proclamation, tighter specialty-occupation tests, and expanded worksite inspections.
Taken together, the measures move the H-1B route from a stable multi-year employment path to a higher-risk arrangement. That is especially true for workers stuck in the employment-based green card backlog. Indian nationals face the longest of those backlogs, often 50 years plus under current per-country caps.
Removing the 60-day rule strips one of the last flexibilities left in that system.
Indian H-1B workers should treat the current 60-day window as a resource with an expiry date. The rule is not yet law, but the direction is set. The next inflection point is the Federal Register publication, when the formal comment clock starts.
- Immediately: Save copies of every immigration document received since first US entry.
- Within 30 days: Line up two to three immigration attorney contacts reachable on short notice.
- Once published: File a written comment with USCIS through regulations.gov.
- Keep two backup employer contacts warm, so a new H-1B transfer petition can be filed in days.
- Track your I-94 expiry, not just the visa stamp, since the I-94 controls lawful status.
Next Key Date for H-1B Workers: Watch the Federal Register in September and October 2026 for the Notice of Proposed Rulemaking. The 30 to 60 day public comment window opens on publication and is the only formal chance to object before the final rule.
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